Kāinga Ora breached political neutrality when it sponsored an article about a political candidate shortly before the 2020 general election, says public service commissioner Peter Hughes.

In a report released on Thursday, Hughes found the public housing agency missed two opportunities to get it right: it should never have sponsored the published article in the first place, and later, when the candidacy of Labour party member, and now MP, Arena Williams was publicly announced, it should have had it immediately taken down.

Hughes also criticised an internal email that suggested the agency could pretend it knew nothing about Williams’ candidacy.

The paid for article was published on NZME's One Roof on May 27 and portrayed Williams as embodying the community spirit at Kāinga Ora’s Hobsonville Point development.

Williams had already advised Kāinga Ora she was only days away from being selected to stand in the election and her candidacy was formally announced on May 29, less than two months before the election campaign began.

Kāinga Ora chair Vui Mark Gosche (a former Labour government housing minister) said the agency fully accepts the findings of the report and during the last few months it has developed staff training and guidance when it comes to how it approaches political neutrality.

'Better triage emerging issues'

In a letter written to Goshce, chief executive Andrew McKenzie said he has set up a senior team “to better triage emerging issues and recommend appropriate actions”. 

“There are now clearer lines of accountability, better processes and the right people  are made aware of any issues.”

He said the comments in the internal email about pretending not to know about the candidacy were “flippant” and not an indicator of the employee’s integrity.

He had personally spoken to them and was very confident the individual would not repeat the behaviour. 

When the email first came to light, a Kāinga Ora spokesperson initially defended the agency’s conduct – but the statement was later retracted after McKenzie intervened.

The misconduct was brought to light by National MP Nicola Willis who said she was astonished no one has been held accountable and called on housing minister Megan Woods to restore confidence in the agency.

“I revealed this conduct following my discovery of a $25,000 per month contract Kāinga Ora entered into with a media entity through which it promoted itself through paid content designed to look like news stories.

 “I am astonished that despite this damning report, no one at Kāinga Ora has been held accountable for its failure to meet its duties as a custodian of taxpayer money.

“Minister Woods must explain why she continues to have confidence in the leadership of Kāinga Ora when not one person has been held accountable for these extraordinary failings."


Willis said the agency’s response was "extremely weak", amounting to little more than the formation of a government relations team and an offer from the commission to hold the hand of executives on future issues.

Woods has written to Gosche to repeat her earlier disappointment that the article was published and “the subsequent responses when the shortcomings were identified”.

She told Gosche the commission’s report would be a standing item in her future meetings with him and expected the board to provide regular reports on how the agency’s work to embed political neutrality was being implemented.

Hughes said he was satisfied McKenzie “... has owned it, fixed it and learned from it. That is what I expect.”

According to Hughes, government advertising must always be impartial and free from the partisan promotion of government policy and political argument.

A more recent case involving the government advertising of the “Three Waters” policy reforms also sparked his intervention.